Oxford Homeowners Are Only Moving Every 18 Years (part 2)

In the credit crunch of 2008/9 the rate of home moving plunged to its then lowest level ever. In 2008 and 2009 the rate at which a typical house would change hands slumped to only once every 17.5 and 15.4 years respectively.

The biggest reason being that confidence was low and many homeowners didn’t want to sell their home as Oxford property prices plunged after the onset of the financial crisis. Between 2013 and 2015, the rate at which people moved increased in Oxford, yet last year, it dropped again to a new lowest level of once every 18 years, meaning as a City, there has been a 44.84% drop in moves by homeowners in Oxford, compared to 15 years ago.

So why aren’t Oxford homeowners moving as much as they did?

In last week’s article I talked about how ‘real’ incomes and savings have been dropping. Another issue is the long-term failure to build sufficient new-build homes of the right type. 

Back in the 1960’s and 1970’s, as a country, we were building on average 300,000 and 350,000 households a year. The Barker Review a few years ago said that for the UK to stand still and keep up with housing demand (inflated by a number of factors including: immigration, people living longer, marital divorce, a 50% increase in the number of households with a single person since the 1980’s) we needed to build 240,000 households a year. Over the last few years, we have only been building between 135,000 and 150,000 households a year. In Oxford just 1% of property sold is new build (just 7 properties sold per month on average over the last 12 months).

As the UK Population gets older, there is no getting away from the fact that a maturing population is less mobile.  Those retired people who want to move are finding there is no suitable smaller option available to them in the place they want to live.

So, what does this mean for Oxford homeowners and landlords?

Many of the older generation in Oxford are stuck in property that is simply too big for their needs. The fact is that, in Oxford, nearly five out of every ten (or 46.5 per cent) owned houses has two or more spare bedrooms; or to be more exact ...

12,470 of the 26,832 owned households in the Oxford

area have two or more spare bedrooms.

As young families struggle to move up the housing ladder, with those young families bursting at the seams in homes too small for them, we have a severe case of under-occupation amongst the older generation – retired people staying put in their bigger homes, with a profusion of spare bedrooms with a dearth of smaller alternative properties available to them.

Many commentators have suggested the Government should give tax breaks to allow the older generation to downsize, yet in a recent White Paper on housing published just weeks before the General Election, there was no reference to any detailed policies to inspire or support them to do so.

This means that there could be an opportunity for Oxford buy to let landlords to secure larger properties to rent out, as the demand for them will surely grow over the coming years. As for homeowners; well those in the lower and middle Oxford market will find it a balanced sellers/buyers market, but will find it a buyers’ market in the upper price bands.  Despite a 17% reduction in completed transactions, prices have risen 7% over the last 12 months, confirming a supply constrained market.